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US Navy officers who shared military secrets see felony convictions dismissed

A San Diego judge on Tuesday dismissed the felony convictions of five military officers who had admitted to accepting bribes from Leonard Glenn "Fat Leonard" Francis.

Leonard Glenn Francis, better known as "Fat Leonard," is a 6 feet, 3 inch tall, 350 pound former Malaysian defense contractor who bribed hundreds of Navy officers for classified information for more than 20 years. He eventually defrauded the U.S. government and American taxpayers out of at least $35 million dollars until he was caught in a sting operation in 2013. After Francis’ arrest, nearly 1,000 Navy officers came under scrutiny, including 91 admirals. Federal prosecutors brought criminal charges against 34 defendants.

In what has become one of the largest scandals in U.S. Navy history, Francis bribed the Navy officers with lavish meals, expensive gifts and orgies in exchange for classified national security information.

A San Diego judge on Tuesday dismissed the felony convictions for five military officers who admitted to accepting bribes from Francis. The convictions were dismissed at the request of the government due to "prosecutorial errors."

Lt. Cmdr. Stephen Shedd’s entire case was thrown out despite his guilty plea to bribery and receiving $105,000 in meals, services from prostitutes and hotel expenses. Marine Corps Col. Enrico DeGuzman and retired U.S. Navy officers Donald Hornbeck, Robert Gorsuch and Jose Luis Sanchez each had their felony convictions dismissed and pleaded guilty to misdemeanor charges for disclosing classified information on Tuesday.

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According to legal filings, Tuesday’s dismissal did not mean the military officers did not commit the crimes for which they were charged; the convictions were dismissed because information was withheld from the defense.

This is just the latest series of setbacks in prosecuting the Fat Leonard case.

Washington Post investigative reporter Craig Whitlock spent the last decade documenting the Fat Leonard scandal and wrote the new book, "Fat Leonard: How One Man Bribed, Bilked and Seduced the U.S. Navy."

"Leonard knew that he gave them a taste of the high life by taking them out to these fancy dinners. He organized these sex parties with prostitutes in Asia… by the time they accepted all these extravagant or illicit gifts, they were really enthralled to him." Whitlock said.

The officers looked the other way as he grossly overcharged on U.S. Navy contracts for his Singapore-based maritime services supply company, Glenn Defense Marine Asia Ltd., which supplied food, water and fuel to U.S. Navy assets.

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"They didn't see Leonard as a threat. He was this big jolly, 350-pound Malaysian guy who seemed very patriotic. 11:15 He wore U.S. flags on his necktie. 11:19 He had Lee Greenwood with God Bless the U.S.A. on his cell phone ringtone. 11:24 So they didn't see him as a foreign risk. Really. They saw him as somebody who is loyal to the U.S. Navy, and frankly, they fell for it hook, line and sinker," Whitlock said.

Francis would take photos of the officers at the parties he would throw with them smiling for the camera. He used it as hard evidence to get what he wanted out of them.

"They literally called him boss like he was their commanding officer because he could order them around," Whitlock said. "Leonard did use this information as a hammer, so to speak. He didn't have to use it in the end, but just the threat that he could use it, he could compel officers who were his informants or moles to do what he wanted."

Francis was lured to San Diego and was caught in a sting operation in 2013. He pleaded guilty in 2015 to offering more than $500,000 in cash bribes to U.S. military officers and faced up to 25 years in prison.

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Francis' bribing did not stop when he was arrested. Later hospitalized and treated for cancer, he convinced the judge to let him go on house arrest to have a more comfortable recovery. In 2022, he cut off his GBS tracker and called an Uber to escape house arrest. He ended up in Tijuana, Mexico, and eventually made his way to Venezuela, where he was captured and sent back to the U.S. in a prisoner swap in December 2023.

Prosecutors are waiting until Francis is sentenced to bring charges related to his escape.

Whitlock told Fox most admirals and senior officers got away with a slap on the wrist from the Navy or nothing happened at all.

"Most of these people who were Leonard's informants and moles said they all knew what they were doing was wrong… but they just frankly thought they would never get caught," Whitlock said.

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